Cisco's chief executive officer, Chuck Robbins, announced on Thursday that the company is experiencing a "networking supercycle" driven by explosive growth in artificial intelligence (AI) infrastructure and hyperscaler orders. As reported by CNBC, Cisco’s shares surged 14% after the networking equipment maker surpassed its AI guidance for the fiscal year, lifting its forecast from $5 billion to an impressive $9 billion.
According to Robbins, this significant increase is due to the heightened demand for AI tools and equipment that will "power our industry toward a new era of growth." The company plans to cut about 5% of its workforce as it shifts focus towards AI-focused segments. In his remarks to CNBC, Robbins stated, “Given the speed at which the market is moving, we need to make a rapid reallocation of resources.”
In another development, Cisco disclosed that it will lay off employees following record revenue in fiscal Q3 2026, as reported by Ars Technica. The company's CFO emphasized that these layoffs are not driven by cost-saving measures but rather part of an overall restructuring plan aimed at aligning with the current market dynamics.
During his announcement to employees, Robbins boasted about the growth delivered for Cisco and stressed that he and other executive leadership team members were “prouder than ever.” However, this pride could not prevent thousands of successful employees from facing unemployment. Robbins added in a blog post: "We could not be prouder of the growth you have all delivered for Cisco."
Despite these layoffs, Cisco remains optimistic about its future prospects and is actively engaging with customers on AI models. As part of Anthropic's Project Glasswing, Cisco has given select businesses access to test the model’s cybersecurity implications.
Looking ahead, Robbins indicated that the company will continue to navigate this rapidly evolving market landscape while ensuring it stays competitive in the burgeoning field of AI infrastructure. The broader tech industry is also experiencing significant restructuring as companies adapt to new demands and opportunities presented by advanced technologies.
This article was produced by AVALW News on Thursday, May 14, 2026 based on reporting from 3 verified news sources. Our editorial process cross-references facts from multiple independent outlets to deliver accurate, comprehensive coverage. All original sources are linked below.